Risto Siilasmaa
Advanced Technologies
NSN

Nokia Chairman Risto Siilasmaa Outlines Its Next Reinvention

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In a blog post, Nokia chairman and interim CEO Risto Siilasmaa gave more details about the company’s plans now that it has exited the smartphones business. This marks the most recent reinvention for the 150-year-old company, which began as a paper mill in the 1860s and moved on to rubber products before morphing into an electronics maker. Without its Devices & Services division, which it sold to Microsoft last week, Nokia now has €13-€14 billion in annual revenue, a workforce of 56,000 and much more cash in its war chest thanks to Redmond’s $7.2 billion payment.

Siilasmaa reiterated the importance of its HERE, NSN and Advanced Technologies units to Nokia’s future, but he did not say what the Finnish company plans to do in 2016, when its agreement with Microsoft will allow it to start selling phones under the Nokia brand again. Though the sale of its Devices & Services division was the final outcome of Nokia’s failure to compete in the smartphone business, Siilasmaa took an optimistic stance.

“Nokia will look very different without the mobile device and services business. But it will be a strong company, with healthy finances and three strong businesses — NSN, HERE and Advanced Technologies — each a leader in technology and innovation,” he said.

Calling networks division NSN “the first element of Nokia Reinvented,” Siilasmaa said it will continue to be managed as an independent unit and focus on mobile broadband and LTE. NSN currently has more than 600 customers in 120 countries, serving 2.5 billion subscribers.

Nokia’s mapping business HERE already has the benefit of counting Microsoft among its key customers–Redmond will license HERE services that are used in Nokia devices.

Nokia has shown keen foresight in acknowledging the importance of mapping and location-based services. Its $8.1 billion acquisition of Navteq in 2007 foresaw Google’s recent purchase of Waze and Apple’s increased focus on its mapping division.

“We believe that location technologies and services will be pivotal in the next phase of the mobile Internet, where more and more devices are connected to the cloud. We also believe that location will become an essential building block across all industries,” said Siilasmaa.

Nokia’s newest unit, which it calls Advanced Technologies, will focus on developing new tech, with a focus on technologies for video and audio encoding such as the H264 standard, low-power connectivity such as Bluetooth LE (low energy) and imaging. Though Siilasmaa did not mention it in today’s blog post, Nokia told us last week that it will invest further R&D in areas such as nano technology and graphene, perhaps to build more of the flexible displays and devices that it has been showing off for years and which its Cambridge lab has already been working on. Nokia is a backer of a Cambridge University graphene R&D center.

Advanced Technologies will also drive the enrichment of Nokia’s intellectual property portfolio, the core of its patent licensing operation, which Siilasmaa says will be expanded in an effort to drive revenue and profit for Nokia.